Wellness Programs Require Healthy Balance to Stay Fair

It sounds like it would be hard to go wrong: Start a wellness program to keep your employees healthy. Offer rewards for them and, hopefully, reduce claims.

But of course, there’s always a way to go wrong. In this case, the key is to avoid discrimination and federal and state law violations, said Kelly Schoening, a partner with Deters, Benzinger & LaVelle, which has offices in Crestview Hills and downtown Cincinnati.

Fortunately, she said, the picture is clearer with U.S. Department of Labor regulations that went into effect Feb. 23. Many employers had been using a similar set of proposed regulations dating to 2001.

“The biggest concern is that if you give a better benefit to a healthy employee (than to an unhealthy one) then you can run afoul of the Americans with Disabilities Act or state law,” Schoening said. “The purpose of the wellness program should be to reward good conduct.”

There’s evidence that employers are putting more emphasis on employee wellness. For example, in 2006, Mercer Health & Benefits found that 22 percent of employers and 53 percent of large employers (in a national survey of 3,000) offered health risk assessments.

Two ways to stay in the clear: don’t base rewards on satisfying a standard related to a health factor, or make the benefits available to all similarly situated individuals.

Some examples would be reimbursing fitness center membership, offering a diagnostic program that rewards participation and not outcomes, and encouraging preventive care through waiver of co-payments or deductibles.

It’s worth the trouble to design a good program, said Tom Colvin, executive vice president at insurance broker Schiff, Kreidler-Shell.

“I’m a firm believer that the only way we’re really going to address the increasing costs is a change in high-risk lifestyles, which is a movement toward the wellness area,” he said.

He added, however, that return-on-investment data are still in early stages. If the program does rest on employees meeting certain health standards, it has to meet several other standards. Key is that the reward be available to everyone.

For example, if a discount goes only to people who keep their cholesterol count under 200, then it isn’t available to everyone, because some people may be unable to reach that level due to a medical condition.

In that case, a “reasonable alternative” has to be disclosed. For example, if a member’s doctor prescribes medication to achieve a reasonable cholesterol count, and the patient follows the doctor’s advice, the patient would still receive the discount.

Schoening’s advice: “Have a lawyer review your program before you start it.”